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Brilliant_brown [7]
3 years ago
12

A water utility is planning to construct a grease treatment facility so that local haulers will not have to transport grease to

a city 550 km away. The facility will cost $400,000 to build and $160,000 per year to operate. Benefits to the haulers and restaurant owners (through reduced costs) are expected to be $250,000 per year. If the facility will have a 10-year life, the B/C ratio at 6% per year is closest to:
Business
1 answer:
romanna [79]3 years ago
7 0

Answer:

The B/C ratio at 6% per year is closest to 1.17

Explanation:

In order to calculate the B/C ratio at 6% per year we would have to make first the following calculations:

Present Worth(PW) of annual operating cost (excel formula) =PV(0.06,10,160000,0) = $1,177,613.93

PW of annual benefit (excel formula) =PV(0.06,10,250000,0) = $1,840,021.76

Present cost (at beginning of project) = $400,000

Therefore, to calculate the B/C ratio at 6% we would use the following formula:

B/C ratio at 6%=PW of benefits-PW of disbenefits/Initial cost+PW of operating and maintenance-PW of salvage value

B/C ratio = ($1,840,021.76 - 0)/($400,000 - $1,177,613.93) = 1.17

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Answer:

The correct answer is D

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So, the private university facing financial problems, they decided to become a profit center. Therefore, this scheme is parallel to SBU which is Strategic business unit.

6 0
3 years ago
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Fantom [35]

Answer:

Interest amounts at December 31st = $80

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6 0
3 years ago
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Dmitriy789 [7]

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Answer:

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Explanation:

Please find the below for detailed calculations and explanations:

To achieve $80,000 of operating income, denote the number of units needs to be sold is x.

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Thus, to achieve the profit of 80,000, the amount of x units sold will generate the profit before fixed cost that covers 24,000 fixed cost and 80,000 targeted profit. So, we have:

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3 years ago
Because both cities are located quite far from each other, a company can charge different prices in each without fear of reselli
Gemiola [76]

Answer :$3

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